[Click eStock] "KT Strengthens Content Capabilities Following Commerce"

Estimated 6.98 Million 5G Subscribers This Year
Meritz Securities "KT Maintains Target Price at 42,000 Won"

[Asia Economy Reporter Gong Byung-sun] KT's third-quarter earnings this year are expected to meet market consensus. Meanwhile, KT is strengthening its content capabilities following its finance and commerce sectors.

On the 13th, Meritz Securities estimated KT's third-quarter revenue to be 6.1908 trillion KRW, a 3.2% increase compared to the same period last year, and operating profit to be 367.9 billion KRW, a 25.8% increase over the same period. These figures align with the consensus estimates of 6.1909 trillion KRW and 359.4 billion KRW, respectively.

All sectors are expected to achieve balanced growth centered on the 5G business. The number of 5G subscribers, which was around 5.014 million at the end of the second quarter, is expected to have increased to 5.93 million in the third quarter. The average revenue per user (ARPU) for wireless subscribers is estimated to have risen 2.6% from the previous quarter to 32,437 KRW. The operating conditions of major consolidated subsidiaries such as BC Card and KT Estate, which had been sluggish due to COVID-19, have also improved, reflecting recovered performance in KT's consolidated results.

For the entire year, KT's revenue is projected to increase by 2.8% year-on-year to 24.59 trillion KRW, and operating profit is expected to grow by 31.7% to 1.5588 trillion KRW. The year-end 5G subscriber count is anticipated to reach 6.98 million, with wireless ARPU growing 2.2% year-on-year to 32,373 KRW.

Additionally, KT is attempting to strengthen its content capabilities as well as its finance and commerce sectors. In mid-year, KT launched KT Alpha, a merged corporation of KTH and KT M-House, to bolster its finance business and grow the media commerce sector. Recently, KT newly participated with 175 billion KRW in a paid-in capital increase of KT Studio Genie to enhance media content.

Jung Ji-soo, a researcher at Meritz Securities, explained, "KT also acquired Hyundai Media, a subsidiary of Hyundai HCN, and renamed it Media Genie. They will continue to strengthen channel competitiveness and content production capabilities."

Accordingly, Meritz Securities maintained a 'Buy' rating on KT with a target price of 42,000 KRW. The closing price on the previous day was 30,500 KRW.

This content was produced with the assistance of AI translation services.